Green Dot 2012 Annual Report Download - page 93

GREEN DOT CORPORATION
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS – (CONTINUED)
83
Note 16—Concentrations of Credit Risk
Financial instruments that subject us to concentration of credit risk consist primarily of unrestricted cash and cash
equivalents, restricted cash, investment securities, accounts receivable, loans and settlement assets. We deposit our
unrestricted cash and cash equivalents and our restricted cash with regional and national banking institutions that we
periodically monitor and evaluate for creditworthiness. Credit risk for our investment securities is mitigated by the types
of investment securities in our portfolio, which must comply with strict investment guidelines that we believe appropriately
ensures the preservation of invested capital. Credit risk for our accounts receivable is concentrated with card issuing
banks and our customers, and this risk is mitigated by the relatively short collection period and our large customer
base. We do not require or maintain collateral for accounts receivable. We maintain reserves for uncollectible overdrawn
accounts and uncollectible trade receivables. Approximately 92.5% of our borrowers reside in the state of Utah and
approximately 39.4% in the city of Provo. Consequently, we are susceptible to any adverse market or environmental
conditions that may impact this specific geographic region. Credit risk for our settlement assets is concentrated with
our retail distributors, which we periodically monitor.
Note 17—Defined Contribution Plan
On January 1, 2004, we established a defined contribution savings plan under Section 401(k) of the Internal
Revenue Code. Employees who have attained at least 21 years of age are generally eligible to participate in the plan
on the first day of the calendar month following the month in which they commence service with us. Participants may
make pre-tax contributions to the plan from their eligible earnings up to the statutorily prescribed annual limit on pre-
tax contributions under the code. We may contribute to the plan at the discretion of our board of directors. Effective
January 1, 2010, our board elected to include a discretionary employer matching contribution equal to 50% of the first
6% of the participant’s eligible compensation as defined by the Plan. Our contributions are allocated in the same manner
as that of the participant’s elective contributions. We made contributions to the plan of $1.2 million, $0.9 million, and
$0.7 million for the years ended December 31, 2012, 2011, and 2010, respectively.
Note 18—Commitments and Contingencies
In December 2011, we entered into a ten-year office lease for 140,000 square feet of office space in Pasadena,
California. This facility serves as our corporate headquarters. The initial term of the lease is ten years and is scheduled
to expire on October 31, 2022. We are also bound to a property sub-lease agreement of approximately 5,000 square
feet that expires in December 2013 and maintain smaller administrative or project offices. Our total rental expense for
these and former leases amounted to $6.4 million, $2.6 million and $1.8 million for the years ended December 31,
2012, 2011, and 2010.
At December 31, 2012, the minimum aggregate rental commitment under all operating leases was:
Year Ending December 31, (In thousands)
2013 $ 4,502
2014 4,196
2015 4,642
2016 4,768
2017 4,260
Thereafter 21,353
$43,721
We have various agreements with vendors and retail distributors that include future minimum annual payments.
At December 31, 2012, the minimum aggregate commitment under these agreements was:
Year Ending December 31, (In thousands)
2013 $ 10,556
2014 5,277
2015 1,910
2016 6,550
2017 1,625
Thereafter 15,750
$41,668